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Wednesday, April 11, 2018

Market Alert - Pre-Market

Futures vs FV: SP 17.92; DJ -191.00; NASDAQ -35.11

Tradable rally. Then a tweet war. Not a trade war, a tweet war. The John Bolton -- I mean the President -- responding to Russia saying it will shoot down US missiles if fired at Syria, says for Russia to be ready for our new, smart missiles. Futures dive. Then the Chief of Staff gets the President's phone and sends an mitigating tweet saying the problem is Russian economy and that the US can help and we can all work together and end the arms race. Futures bounce back some. Then the Trump takes his phone back and blames it all on the Russia probe. 'Whose on first?' diplomacy.

Monday stocks sank from nice gains on a news story. Tuesday they rallied right back because that is what they wanted to do. Well, we will see if they still want to do that today. Trade wars, possible shooting wars, politics as usual. If it goes up, the market must really want to go up.

The setup is there: selling ahead of earnings. Good patterns to support a rebound rally. Stocks acting as if they want to rally. Can they pull the trigger again today given stocks are now even more a 'buy?' Futures are still recovering off the lows . . .

CPI, March: -0.1%, +2.4% year/year, down from 2.7%

Core: 0.2% as expected. 2.1% year/year

Gasoline -4.9%; Apparel -0.6%; Vehicles -0.1%; Medical care +0.4% -- Obamacare still working well as it is still in place.

First headline decline in 10 months.

Paul Ryan: not running for reelection

Bonds: 2.761% vs 2.801%

EUR/USD: 1.2372 vs 1.2359

USD/JPY: 106.85 vs 107.09

Oil: 65.94, +0.43

Gold: 1356.40, +10.50

Stocks are trying to accelerate the recovery toward the open, but still a long, long way to go to even get to flat.

Going to look at some stocks we passed on Tuesday as possibilities on the dip, e.g. CREE, VCEL. The environment is rocky, but the setup is there and Tuesday showed some stronger acquisition so we are still looking to pick up some positions to the upside.

Jon Johnson, Chief Market Strategist
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